Each year, the healthcare industry faces a heart-pounding Annual Enrollment Period (AEP) where eerie complexities can leave you in fear. Join me on a journey, as I unveil my personal “tricks and treats” to better navigate this could-be horror show.
In September 2011, my company, Convey Health Solutions, a prominent software and services organization catering to health plans within the Medicare market, embarked on a transformative journey to overhaul operations. The primary objective was to provide enhanced support for our health plan clients. As part of this reorganization, I found myself thrust into the intricate realm of Medicare Part D.
Navigating the operational complexities of Medicare
In the blink of an eye, I assumed the reins of an exceedingly complex, multifunctional Medicare operation. This encompassed telesales, customer service, back-office enrollment, premium billing, mailroom operations, and grievance management for a Medicare Part D business. What made this endeavor even more challenging was my complete lack of prior experience or understanding in this domain. Until then, my experience had primarily revolved around overseeing smaller operational teams dealing with relatively straightforward products, such as our Medicare Part B home delivery business and the burgeoning over-the-counter supplemental benefits venture.
Despite my status as a seasoned veteran in the healthcare industry, nothing could have prepared me for the monumental transition in 2011. Increasing the complexity, this transition coincided with the looming specter of the Annual Enrollment Period, which was less than a month away.
The stress of AEP
To comprehend the sheer complexity of AEP, one must consider the staggering number of eligible Medicare beneficiaries–approximately 60 million. This group primarily comprises seniors aged 65 and above. They are all granted the option to switch plans simultaneously within a mere 53-day window. It begs the question of why the government decided to condense a year's worth of operational activity, including call volume, mail volume, and intense beneficiary education, for millions of beneficiaries into this tight timeframe. For health plans, including those supported by Convey Health Solutions, this period represents an unnatural chaos, hence the reference to "Halloween Horror Nights." Credit for this analogy goes to my dear friend, John Selby, a Medicare consultant at Rebellis Group.
Imagine the stress of traversing the scariest haunted house you've ever encountered. No matter how much preparation you undertake before entering, there is no way to fully anticipate the experience. There will always be an unexpected surprise that catches you off guard–that's AEP!
For a company like mine, which supports Medicare plan sponsors that range in size from new entrants in the market to nine of the top 10 health plans in the country, the "haunted house" stress of AEP is all too familiar. AEP is a daunting challenge for health plans, irrespective of their size. On average, 80% of our annual call volume occurs during AEP. When I initially assumed my role overseeing a Medicare operation, I had an average of 500 employees. But when AEP started, we tripled our staff to 1,500, adding nearly 1,000 temporary employees to accommodate the 53-day surge in volume.
Today, as an operations leader entering my twelfth year of scaling a Medicare operation to navigate AEP, nothing surprises me anymore. The post-COVID-19 landscape, marked by U.S. labor shortages and increased wages, has further compounded the challenges for health plans looking to succeed during AEP. Each AEP season presents a unique set of challenges, but with early planning and forward-looking mitigation strategies, the stress of AEP can be alleviated to a significant extent.
AEP "Horror Night": A cautionary tale
Here's a hair-raising tale from one national Medicare Part D plan sponsor. Initially, they forecasted their Part D membership to remain flat with 0% net new growth. So, we staffed the call center accordingly. However, net new membership increased by approximately 50%, adding 400,000 net new members. Call center attrition doubled year over year, and grievance volume surged four times year over year.
Despite substantial membership growth, we found ourselves understaffed operationally, resulting in long hold times in the call center and dissatisfied beneficiaries. So, we put a real-time and future year mitigation strategy in place to prevent this from happening to us, and the plan sponsor, again. To combat high attrition in the U.S., we increased wages for all operations staff by 15-20%. We transitioned U.S. employees to a work-at-home environment to compete with other call centers offering similar options. We adopted a mix of U.S. and offshore resources. And we continued development of self-service capabilities, such as IVR and online web options, allowing beneficiaries more choices to self-serve and reduce wait times.
While beneficiary choice is important, and I believe Medicare beneficiaries should have the opportunity to switch plans, it's worth considering whether a less operationally challenging approach could be implemented. The condensed enrollment period not only poses operational challenges but necessitates substantial investments in staff and technology to engage and educate Medicare beneficiaries, thereby increasing costs to the healthcare system.
No matter how well-prepared a health plan or supplier is, and no matter how early planning begins, inherent unknowns within the system–including how the competitive landscape will evolve year to year–make it virtually impossible for health plans to be fully prepared for AEP.
AEP trick and treat
Here are a few valuable “tricks and treats” I've learned over the past twelve Medicare Annual Enrollment Periods that can help you enhance your AEP execution strategy:
- Don't take a break: As soon as AEP ends on December 7, immediately document lessons learned.
- Use technology to your advantage: Automate and implement self-serve capabilities to reduce reliance on human resources.
- Start planning your operational strategy for the next AEP as soon as Welcome Season ends in late February.
- Assemble your project team and kick off your AEP project by May, if not earlier.
- Allocate five to six months for operational preparation, maybe more for complex product strategies and benefit changes.
- Develop a well-vetted, formal project plan to guide your work.
- Create a formal mitigation plan for every functional area of your business in case things don't go as planned.
- Re-forecast membership, enrollment, and call volume early and often.
- Begin hiring call center staff early to stay ahead of the competition (by early summer).
- Anticipate that things won't always go as planned, and don't let it stress you out. Some factors are beyond your control.
- Brace yourself for the AEP journey, and remember that you're not alone in this challenging endeavor.
As I reflect on my 12 years of navigating the twists and turns of the healthcare industry's own version of “Halloween Horror Nights”, I'm reminded that, like the scariest haunted house, there will always be unexpected surprises. The post-COVID-19 landscape has only added to the challenges we face, but with early planning, innovative strategies, and the dedication of our teams, we can find our way through the maze of uncertainty.
The healthcare industry's commitment to providing quality care and service to Medicare beneficiaries remains unwavering. Each AEP season will present unique challenges. Stay vigilant, learn from experiences, and work together. We can successfully navigate the darkest corridors of this healthcare maze.
Face your fears